‘No loopholes’: Readers demand watertight wealth tax after Gary Linker’s millionaires’ letter to Andy Burnham
M.More than 100 British-born millionaires, led by Gary Lineker, have written to Andy Burnham urging him to tax their wealth more, telling the new prime minister “we can afford it”.
Independent Readers largely agree, with almost four-fifths in our survey supporting a wealth tax on the super-rich.
But their support in the comments came with a clear condition: Close the gaps first.
Readers repeatedly point out what they need to see before trusting that any wealth tax will work: exit taxes, stricter reporting requirements, and no room for tax advisors to help the wealthy avoid the bill.
While some have pointed to modest schemes abroad as evidence that they can be successful if implemented correctly, others have questioned why any millionaire needs the legislation when they can donate to HMRC today.
Here’s what you need to say:
Close all loopholes first, then tax fairly
A wealth tax is a very good idea, but it is not enough on its own. The government must secure the tax base through legislation to:
A) Ensure that all UK citizens (wherever they choose to live) and all foreign citizens living and/or owning property in the UK are required by law to pay UK taxes, unless they can prove they have paid an equal or greater amount elsewhere.
B) Ensure that all wealth of all UK citizens and residents is properly and fully reported and recorded.
C) Charge exit tax on the wealth of anyone who decides to leave the UK to avoid taxes.
D) Requiring all tax advisers, accountants and lawyers to be licensed by HMRC to provide tax advice, obtain prior approval from HMRC for any schemes proposed to clients, and report on any tax avoidance activities of their clients. It is unacceptable that a whole industry of agents and consultants exists to help the rich avoid paying taxes.
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Once the tax base is secured, a well-designed, progressive wealth tax could generate a lot of revenue and eliminate the extreme growth in inequality that is already negatively affecting our society and is getting worse.
bobcat
They could already donate to HMRC if they wanted
Nothing’s stopping millionaires from visiting HMRC’s “Donate tax” page and paying tax until they’re blue in the face. But no. What they actually want is for others to collect taxes. Meanwhile, £24bn a year will be wasted by the government within months on new HS2s, aircraft carriers not operating in hot water, pay rises for train drivers and PPE-like scandals. But ultimately the outflow of wealth from Britain will not be reversed for generations.
MooreCLanes
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Start with exit tax and end loopholes
Any wealth tax should be targeted at the 20,000 people whose wealth exceeds £10 million, and there are NO loopholes through which they can squirrel away their wealth.
Start with exit tax and HMRC’s ability to tax wealth anywhere on the planet. The United States taxes its citizens wherever they choose to live. And don’t forget to provide resources for HMRC to have the staff to do the job.
Warren Balls
See how Italy made a modest wealth tax work
Italy uses low tax incentives to attract high net worth individuals. But they also impose a fairly modest wealth tax on luxury goods (fast cars, yachts, second homes and stock investment portfolios). The problem with the UK (and other European countries where wealth taxes have failed) is that they want to impose punitive taxes on rich people. They and their beings are often very active. The trick is to impose a modest wealth tax that raises income but is low enough for people to wear.
YetAnotherName
The super rich are getting richer
At a time when the richest 0.001 percent have three times the wealth of the poorest 50 percent worldwide, something needs to be done because their only interest is getting richer. There is bound to be fear-mongering in the right-wing press about higher taxes for them, but this is all in the hands of people who fall into the “super-rich” category and will naturally use whatever propaganda they can to deter such a move. It’s great that Lineker and so many others want to contribute extra tax, but there are even more who don’t.
Antmanbee
This isn’t actually a wealth tax, it’s tax equality
The argument is framed as a wealth tax, but it could just as easily be expressed as equalizing tax rates on earned and unearned income. We generally have a situation where the wealthier you are, the lower your effective tax rate, and that doesn’t seem right. At the other end of the scale, I wonder what the impact would be if we abolished VAT (another regressive tax) while at the same time lowering the base rate threshold.
RickC
Don’t tax the asset, tax it when sold
The thresholds for this type of tax do not increase over time, and people we cannot imagine paying now will be dragged into it in the future. I also strongly believe that wealth should be taxed the moment the asset is converted into cash or dies. You should not be taxed for holding an asset. Not everyone uses their assets to build credit to avoid taxes. Personally, I would change the capital gains tax to apply to all home sales, not just second homes.
KrakenEngland
Lineker has already fought HMRC and won
I would venture to guess that there aren’t many people on the list who have enough assets to pay a 2 per cent wealth tax on assets over £100 million. There are just so-called influencers and “community hoppers” who have little intention of paying more than they have to. Lineker of course fought (and won) a £4.9m IR35 tax appeal against HMRC just a few years ago. Perhaps he and his co-signatories could start by making voluntary payments to HMRC/Treasury in addition to “normal tax dues” via the official route available for such payments in the UK Government website guidance. They don’t even need to tell us how much extra they intend to give. Oh right, they are looking for others to tax and will keep their hands firmly in their pockets.
Invoices
A transaction tax might also work
I saw someone suggest a transaction tax. Set an exemption level so that the less wealthy are not taxed. The more you spend, the more you pay. I don’t remember the exact numbers, but it could raise billions of dollars and even reduce other taxes that disproportionately affect low-income people.
Rubble
Go after the Amazon and fossil fuels
It is good for them because they are principled. Russian oligarchs and their friends should also be shot (if they have not already been taxed). Burnham also needs to impose fair taxes on companies like Amazon that aren’t paying what they’re owed, and—crucially—to fairly tax fossil fuel companies for their wildly obscene profits; especially given the environmental and climate damage they have deliberately and consciously caused and continue to cause, while thwarting any attempt to prevent them.
JanuaryP
Some of the comments in this article have been edited for brevity and clarity.
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